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President Trump signed on Wednesday a decree that cancels any student loan debt for any US military veteran with a lifetime disability.
The ordinance, which Trump signed following a speech at the US Veterans Convention in Louisville, Kentucky, also exempts eligible veterans from paying any federal taxes. on their loans. Trump added that he was pressuring every state to do the same.
"The debt of these disabled veterans will be completely erased," Trump said. "It's a debt of several hundred million dollars of student loans for our disabled veterans that will be completely erased."
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The memo signed by Trump urges the government to put in place an "expedited" process so that veterans can see their federal student loan debt discharged "with minimal burden." At present, barely half of the approximately 50,000 disabled veterans who are eligible for cancellation of their federal student loan debt have received the benefit because of a tedious application process .
As part of the current process, disabled veterans can obtain the cancellation of their debt under a loan waiver program called total and permanent disability leave, provided that their rate of disability Disability related to the service of the AV is 100%. In July, however, only about 20% of the pool of eligible veterans had benefited from the program because of the complicated nature of the application and other factors.
Trump's announcement came just days after the administration hired a long-time student loans executive to become the federal government's lead agency in the student loan market. Robert Cameron will be the new Student Loans Ombudsman for the Office of Consumer Financial Protection, the office said Friday.
This is a job designed to protect student loan borrowers from bad practices in the student loan sector and one of the few positions explicitly named in the Dodd-Frank Act, passed after the 2008 financial crisis. who created the office. It is considered the reference office of borrowers who complain about their loans. Cameron recently worked for the Pennsylvania Higher Education Assistance Agency, better known as FedLoan Servicing, as the Compliance and Risk Mitigation Officer.
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PHEAA has been cited for poor industry practices, particularly for the way it has handled the troubled public service loan forgiveness program, a program designed to allow borrowers who use student loans and who have jobs in the public service to obtain a portion of their pay.
The decree law also comes as the cancellation of student loans has become a major topic of debate among the Democratic presidential candidates of 2020, with contenders like Sens. Bernie Sanders of Vermont and Elizabeth Warren of Massachusetts pushing plans to completely eliminate student debt in the United States.
At present, Americans hold about $ 1.6 trillion in student debt.
Associated Press contributed to this report.
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